Information Technology: A Key for Business Process Reengineering
ABSTRACT
The purpose of the paper is to take a comprehensive look at Business Process Reengineering (BPR), which is a popular term for the reoptimization of organizational processes and structures after the implementation of new information technologies into an organization. There is some evidence that changes in the use of information technology (IT) in an organization may require major restructuring of the organization to take full advantage of the technologies. This paper will attempt to demystify the myths of BPR. It will examine the advantages and disadvantages of BPR in organizations. The paper will also explore the various phases of the BPR process and the relationship between BPR and Information Technology (IT). Information Technology should be viewed as more than an automating tool but rather a fundamental way to reshape the way business is done. The examination of IT will reveal the use of IT tools within the BPR process which typically results in faster, better and cheaper solutions at each phase of the BPR process. The primary methodology of the research will be through literature.

how to redesign these processes to eliminate the wasted or redundant effort. and how to implement the process changes in order to gain competitiveness. such as ‘core process redesign’. the organization has no foundation upon which to build process improvements. For a thorough and effective reengineering project.1. Generally the topic of BPR involves discovering how business processes currently operate. ‘new industrial engineering’ or ‘working smarter’. The purpose of BPR is to find new ways to organize tasks. the paper will explore two questions: where does BPR comes from and what is involved in BPR in terms of principals and assumptions. All of them imply the same concept that focuses on integrating both business process redesign and deployment of information technologies (IT) to support the reengineering work. Introduction
Business Process Reengineering (BPR) is known by many names. BPR is a method of improving the operation and therefore the outputs of organizations. This paper will attempt to introduce some of the more important aspects of BPR and the significance and role of information technology in BPR. organizations should first meet
. improve efficiency. What is BPR?
Business process reengineering ideas are based on the premise that every organization needs a sense of direction. organize people and use information technology so that the processes support the organization’s goals. In addition.
2. Without that direction in the form of strategic plans and business plans. It means analyzing and altering the business processes of the organization as a whole.

processes are analyzed in the organization. the management should abandon all the rules and procedures that have been used upto that time. Radical change is the only means of obtaining the order of magnitude improvements necessary in today’s global marketplace.1 BPR as Radical Change
BPR is a radical change rather than an incremental change. and then IT is used to redesign and streamline organizational processes. the design of a renovated and redesigned organization should begin. Davenport (1993) advocates radical change as: Objectives of 5% or 10% improvement in all business processes each year must give way to efforts to achieve 50%. Vidgen (1994) defines the central key points of BPR as: • • • • radical change and assumption challenge process and goal orientation organizational restructuring the exploitation of enabling technologies. Initially.
2. 100%. In addition they should abandon other inadequate organizational and production principles. quality. contemporary measures of performance. particularly information technology which means that by focusing on business objectives. Existing approaches to meeting
. such as cost.certain conditions before starting such a project. service and speed”. non-essential or redundant procedures are eliminated. or even higher improvement levels in a few key processes. “Reengineering is the fundamental rethinking and radical redesign of business processes to achieve dramatic improvements in critical. At this point. According to Hammer and Champy (1993).

Inputs and outputs are defined. Process-Orientation: From Structure to Process
Many current business processes with their functional structures were designed to enable efficient management by separating processes into small tasks that could be performed by less skilled workers with little responsibility.
4. BPR Process and Approach
Process redesign. In comparison. A new process is designed from scratch using the above. BPR attempts to radically break the existing process structures and replace them with innovative solutions. The change is planned and implemented to achieve minimum
. That means. and future. Traditional structural approaches to a business reengineering generally follow this sequential order. First.
3. takes a ‘clean sheet’ approach to the process. then the business structures and processes are planned. the higher skilled and more trusted managers made the important decisions. New technology. BPR is regarded as process-oriented which is trying to overcome some problems raised by hierarchical structures. often called BPR.customer needs are so functionally based that incremental change will never yield the requisite interdependence. and finally they are implemented with IT. and checked to ensure they align with customers’ present. Under this structure. a business strategy is proposed. methods and data flows are considered in relation to the process. BPR as process-orientation changes the structural relationships between management and employers into the interactive processes between them. or so slow that it is no longer competitive in delivering the company’s value to its customer. requirements. which is usually either broken.

which is key to achieving the business objectives. with special emphasis on customers. measured set of activities designed to produce a specified output for a particular customer or market. process improvement can take different forms like analysis and improvement. The most common approach to process improvement is to take an underperforming process. and create a systematic analysis to determine the most important areas for improvement. Where a fundamental redesign of the entire process is not required. processes may be defined based on three dimensions:
.disruption. According to Davenport & Short (1990). creating a marketing plan or processing and paying an insurance claim. continuous improvement or simply attempts to gain more control. and organization units involved. ordering goods from a supplier. This is part of an overall culture change that needs to be clearly thought through and well directed from the top of the organization. In their view processes have two important characteristics: a) They have customers (internal or external) b) They cross-organizational boundaries Processes are generally identified in terms of beginning and end points. interfaces." A process is "a structured. Davenport & Short (1990) define business process as "a set of logically related tasks performed to achieve a defined business outcome. It implies a strong emphasis on how work is done within an organization” (Davenport 1993). These are then addressed on a project-by-project basis. Continuous improvement is the ongoing management of the process after it has been redesigned and streamlined. A temporary process improvement team that primarily consists of people within the process controls the analysis and improvement. Examples of processes include developing a new product.

it does not guarantee a revolutionary approach to change. The Myth of the Clean Slate: Regardless of Hammer's (1990) sentiment: "Don't automate. a more affordable approach for most companies is to use Clean Slate Design. They could be interorganizational.a) Entities: Processes take place between organizational entities. b) Objects: Processes result in manipulation of objects. Therefore. although based on familiar concepts. Myths about BPR
The concept of BPR is widely misunderstood and has been equated to downsizing. the implementation is done over several phased projects. interfunctional or interpersonal. Or. as Davenport and Stoddard (1994) state: A "blank sheet of paper" used in design usually requires a "blank check" for implementation. These key components have never been together before. which involves a detailed vision for a process without concern for the existing environment. a revolutionary change process might not be feasible given the risk and cost of revolutionary tactics. c) Activities: Processes could involve two types of activities: managerial and operational. Some opponents of BPR say that despite the delivery of radical design. Davenport & Stoddard (1994) identify several reengineering myths: The Myth of Reengineering Novelty: Reengineering. Moreover. obliterate!" clean slate change is rarely found in practice. introduces new concepts that are combined in a new format. These objects could be physical or informational. client/server computing and several other management techniques of the past several years.
5. However. The Myth of Information Systems Leadership: Information Systems (IS) is generally viewed as a partner within a cross-functional team that is generally headed by a non-IS
.

The Myth of Reengineering vs. The factors listed below are based on various articles and empirical research on BPR implementation. continuous improvement. The distinction between IT and IS begins with the idea that IT offers strategic relevance. fundamental changes in thought and actions. "Profound. incremental approaches. which create an irreversible discontinuity in the experience of a system" (Adams 1984). and restructuring techniques.project leader and a non-IS business person who has better control over the processes that are being redesigned. Organizational transformation is defined as. which is a discontinuous change in the organizations or group's shared meaning or culture. Moreover.
6. however it is not the same as transformation. The Myth of Reengineering vs. BPR Success/Failure Factors
There are both soft and hard factors that cause success and failure of BPR efforts. Transformation: BPR is a process that contributes to organizational transformation. Organizational transformation is generally about the emergence of a new belief system and necessarily involves reframing. These dimensions are: • • • • change management management competency and support organizational structure project planning and management
. IT has an impact on BPR projects that can improve the quality of an organization’s information systems management. Quality: Most companies have approaches to organizational change including reengineering. It also involves broad changes in other organizational dimensions besides the work processes.

and clear. especially when discussing sensitive issues related to change such as personnel reductions. even with those not involved directly in the reengineering project.1 Factors relating to Change Management Systems and Culture Factors relating to change management systems and culture are important to the success of BPR initiatives. Communication is needed throughout the change process at all levels and for all audiences. Empowerment means that staff is given the chance to participate in redesign processes. As BPR results in decisions being pushed down to lower levels. Since it establishes a culture in which staff at all levels feel more responsible and accountable and it promotes self-management and a collaborative teamwork culture.Figure 1: Summary of Key Success/ Failure Factors in BPR (Al-Mashari &Zairi. employees are able set their goals
. Effective communication is considered a major key to successful BPR-related change efforts. Communication should be open. 1999) 6. Effective communication between stakeholders inside and outside the organization is necessary to market a BPR program and to ensure patience and understanding of the structural and cultural changes needed as well as the organization's competitive position. is considered by many researchers to be a crucial component of any BPR effort.and social related changes needed by management to facilitate the acceptance of newly designed processes and structures into working practice and to deal effectively with resistance. When empowered. Change management. which involves all human. honest. empowerment of both individuals and teams becomes a critical factor for successful BPR efforts.

This vision must be clearly communicated to a wide range of employees who then become involved and motivated rather than directly guided. And champions of the change play a major role in overcoming these barriers and increasing the chance of successful BPR implementation. and proper communication with all parts in the change process. 1993) in order to provide a clear vision of the future. Commitment and leadership in the upper echelons of management are often cited as the most important factors of a successful BPR project. Leadership has to be effective and creative in thinking and understanding (Hammer and Champy. deploying emerging technologies with little
. The most noticeable managerial practices that directly influence the success of BPR implementation are top management support and commitment. and organizational risks are all associated with BPRrelated change. Sufficient authority and knowledge. economic.2Factors for Management Competency Sound management processes ensure that BPR efforts will be implemented in the most effective manner. and effective management of risks.
6. championship and sponsorship. Commitment to and support for the change must constantly be reinforced from senior management throughout a BPR project. 1993). are important in dealing with organizational resistance during BPR implementation (Hammer and Champy. Barriers such as political. The champions must be able to persuade top management of the need to change and to continually push the change efforts throughout the organization. Risks associated with acceptance of changes in the organizational structure. BPR implementation involves radical change to several systems in the organization.and monitor their own performance as well as identify and solve problems that affect their work thereby supporting the BPR efforts.

Teams should be made up of people from both inside and outside the organization (Hammer and Champy. However. how human resources are integrated. An adequate job integration of organizational human resources infrastructure is important to a BPR project's success. the move to integrate human resources necessitates a careful consideration of all related organizational changes. continuous risk assessment is needed throughout the implementation process to deal with any risk at its initial stage and to ensure the success of the reengineering efforts. complementary skills among team members
. When individuals within a process perform a series of tasks efficiently. and loss of earnings (Towers. 1993). Effective BPR cross-functional teams are a critical component of successful BPR implementation. 1995) are some examples of the many risks that an organization may take when implementing BPR. The determinants of an effective BPR team are as follows: competency of team members. large investment in new resources needed for the new processes.3 Factors relating to Organizational Structure As BPR creates new processes that define jobs and responsibilities across the existing organizational functions (Davenport and Short. processing time. Therefore. Clemons. 1990). their credibility within the organization and their creativity. Anticipating and planning for risk handling is important for dealing effectively with any risk when it first occurs. and cost are all going to improve. Team members should be experienced in variety of techniques. loss of personnel. proper organization of the team.familiarity. 6. and how the new jobs and responsibilities are going to be formulated. effective team leadership. 1994. team empowerment. there is a clear need to create a new organizational structure which determines how BPR teams are going to look. motivation. product quality.

In addition. Effective use of project management techniques and managing people-related issues have also a crucial role in smoothing the flow of the process redesign stages. The IT infrastructure and BPR are interdependent in the sense that deciding the information requirements for the new business processes determines the IT infrastructure. effective use of consultants.4 Factors related to BPR Project Management Successful BPR implementation is highly dependent on an effective BPR Program management. 6.and adequate size. adequate resources. Effective overall system architecture. As BPR results in a major structural change in the form of new jobs and responsibilities. effective planning and project management techniques. An adequate understanding of technologies for redesigning business processes is necessary for proper selection of IT platforms. recognition of IT capabilities provides alternatives for BPR. it becomes necessary for successful implementation to have formal and clear descriptions of all jobs and responsibilities that the new designed processes bring along with them. 6. Building a responsive IT infrastructure is highly dependent on an appropriate determination of business process
. Proper planning for the BPR project with an adequate time frame are key factors in delivering a successful BPR project on time. flexible IT infrastructure and proper installation of IT components all contribute to building an effective IT infrastructure for business processes. Measurement of project progress should also be maintained continually throughout a BPR project.5 Factors related to IT infrastructure Building an effective IT infrastructure is a vital factor in successful BPR implementation. building a process vision integrating BPR with other improvement techniques. which includes strategic alignment. identification of performance.

in terms of their responsibilities and their expertise. They claim that IT has traditionally been used to increase the speed of work but not to transform it and BPR is about using IT to do things differently. But inappropriately implementing IT may create barriers to responding to the rapidly changing business environment. and the sequencing and reliance on other organizational processes. Properly implementing IT can improve the competitive position of organizations.information needs . Linkages between the IT infrastructure components are important for ensuring integrity and consistency among the IT infrastructure components. Some authors view IT as the central implementation vehicle of BPR. is determined by the types of activities within a business process. However BPR has not really worked as its proponents expected. IT plays an important role in BPR. beginning with business strategy and IS strategy and passing through designs of data. Therefore. Davenport and Short (1990) attribute this problem to a lack of understanding of the deeper issues of IT. Further. The IT infrastructure shared services and the human IT infrastructure components. IT standards also have a major role in reconciling various infrastructure components to provide shared IT services that are of a certain degree of effectiveness to support business process applications. An effective IT infrastructure follows a top-down approach. This. in turn. systems and computer architecture.
7. Selecting an IT Application
One main objective of BPR is to use IT to support radical change. simply picking IT packages cannot achieve successful BPR if it is simply used to speed up the process rather than reengineer it. As Davenport (1993) contends:
. are both vital to the process of the IT infrastructure composition.

8.that are designed for functional hierarchies are primarily designed to support incremental improvements and cannot achieve the radical change in BPR projects. IT is the enabler to reengineer processes and is an important driving force for business transformation. Hammer (1990) considers it to be the key implementation of BPR. not tasks Have those who use the output of the process perform the process Interleave information processing work into the real work that produces the information
. Discontinuous thinking is a way to recognize and break away from the outdated rules and fundamental assumptions that underlie operations.
While information systems provide fast processing and response. people. they often fail to provide the flexibility for human communication. Hammer (1990) suggests the following principles of reengineering: • • • Organize around outcomes. However. these rules are based on assumptions about technology. This means IT may sometimes have a negative impact by merely automating the existing processes. BPR and Information Technology
There is a relationship between BPR and information technology (IT). and organizational goals that no longer exist. Usually. He argues that at the heart of reengineering is the idea of discontinuous thinking. it could also have a positive impact if it is deployed correctly in conjunction with the organization’s goals. which can lead to serious consequences. He says the use of IT is to challenge the assumptions inherent in the work processes that have existed since before the advent of modern computer and communications technology.

and build control into the process
•
Capture information once and at the source
Davenport & Short (1990) argue that BPR requires taking a broader view of both IT and business activity. and of the relationships between them. and effective use of software tools are a few of the most important factors that contribute to the success of BPR projects. The strategy describes the role of IT in leveraging changes to business processes and infrastructures. while the IS manager should be responsible for designing and implementing the IS strategy. adequate measurement of IT infrastructure effectiveness. proper IS integration. increasing IT function competency. effective reengineering of legacy IS.• • •
Treat geographically dispersed resources as though they were centralized Link parallel activities instead of integrating their results Put the decision point where the work is performed. Many researchers and practitioners have increasingly considered factors related to IT infrastructure as a vital component of successful BPR efforts. The business strategy should be clear and detailed. building an effective IT infrastructure. IT should be viewed as more than an automating or mechanizing force but rather as a way to fundamentally reshape the way business is done. Effective alignment of IT infrastructure and BPR strategy. Top management should act as a strategy formulator who provides commitment for the whole process of redesign. IT strategic alignment is approached through the process of
. adequate IT infrastructure investment decision. This alignment of IT infrastructure and BPR strategy are needed to ensure the success of the BPR initiative. 1993). IT can best enhance an organization’s position by supporting a business-thrust strategy (McDonald.

examining the IT infrastructure strategy against the BPR strategy. The following figure shows the multidimensional nature of BPR. IT capabilities should support business processes
. 2000) Business activities should be viewed as more than a collection of individual or even functional tasks. IT and BPR have recursive relationships.integration between business strategy and IT strategy.
Business Legacy IT Legacy
Strategic Vision
Strategic Choice
BPR Strategy: -Unit of Analysis -Scope -Scale -Pace
Business pressures IT Strategy
Figure 3: Multidimensional View of BPR (Light. the active involvement of management in the process of IT infrastructure planning and IT managers in business planning. The degree of alignment between the BPR strategy and the IT infrastructure strategy is indicated by including the identification of information resource needs in the BPR strategy. and by the degree of synchronization in formulating the two strategies. as well as between IT infrastructure and organizational infrastructure. They should be viewed as a way to achieve maximum effectiveness. deriving the IT infrastructure strategy from the business strategy.

It would also need to incorporate the skills of process measurement. The IS group may need to play a behind-thescenes advocacy role. Although. innovative uses of IT would inevitably lead many firms to develop new structures. Such structures may raise the organization's capabilities and responsiveness. and redesign. convincing senior management of the power offered by IT and process redesign. recursive view of IT and BPR as the new industrial engineering. Business processes represent a new approach to coordination across an organization.and business processes should be implemented in terms of the capabilities IT can provide. enabling them to coordinate their activities in ways that were not possible before. analysis. IT's promise is to be the most powerful tool for reducing the costs of coordination (Davenport & Short 1990). Also. information technology is critical in reducing the Degree of Mediation and enhancing the Degree of Collaboration. In this framework. The way related functions participate in a process can be differentiated along two dimensions: degree of mediation and degree of collaboration. BPR has its roots in IT management. They define the Degree of Collaboration of the process is the extent of information exchange and mutual adjustment among functions when participating in the same process. They define the Degree of Mediation of the process as the extent of sequential flow of input and output among participating functions.
. it is primarily a business initiative that has broad consequences in terms of satisfying the needs of customers and the firm's other constituents (Davenport & Stoddard 1994). Davenport & Short (1990) refer to this broadened. leading to potential strategic advantages.

In contrast. Identify the Processes to be Redesigned: Most firms use an approach. Design and Build a Prototype of the New Process: The actual design should not be viewed as the end of the BPR process. and the involvement and satisfaction of customers. According to Malhotra (1998). Unrealistic scope and expectations.
. it should be viewed as a prototype. or those that conflict most with the business vision. which focuses on the most important processes. 70% of the BPR projects fail. which implies specific business objectives such as Cost Reduction. with successive iterations. Identify IT Levers: Awareness of IT capabilities can and should influence process design. The metaphor of prototype aligns the BPR approach with quick delivery of results. Resistance to change. He states the biggest obstacles that reengineering faces are: • • • Lack of sustained management commitment and leadership. Time Reduction or Output Quality improvement. Davenport and Short (1990) prescribe a five-step approach to BPR:
Develop the Business Vision and Process Objectives: BPR is driven by a business vision. Understand and Measure the Existing Processes: Important to avoid the repetition of old mistakes and for providing a baseline for future improvements. A fewer number of firms use the exhaustive approach that attempts to identify all the processes within an organization and then prioritize them in order of redesign urgency.9.

He notes that most failures of reengineering are attributable to the process being viewed and applied at a tactical.
. Empowered and Collaborative Workers. To turn around negative conditions. Fear and Lack of Optimism. They also identify negative preconditions related to BPR as: The Wrong Sponsor. Markus et al. and. He concludes that the ultimate success of BPR depends on the people who do it and on how well they can be motivated to be creative and to apply their detailed knowledge to the redesign of business processes (Davenport & Stoddard 1994. A "Do It to Me" Attitude. Identifying New Product and Market Opportunities. notably. and Narrow Technical Focus. (1994) outline the positive preconditions for BPR success as: Senior Management Commitment and Sponsorship. Developing a Human Resources Strategy. organizations should: Do Something Smaller First (pilot project). Conduct Personal Transformation (change of mindset). King (1994) views the primary reason for BPR failure as overemphasis on the tactical aspects and the strategic dimensions being compromised.Based on the BPR consultants' interviews. Animosity Toward and By IS and HR Specialists. CostCutting Focus. He discusses that there are important strategic dimensions to BPR. Defining the Process Structure and Assumptions. Bashein et al. Coordinating the Reengineering Effort. The negative preconditions relating to the Organization include: Unsound Financial Condition. Realistic Expectations. 1994). Too Many Projects Under Way. and Get IS and HR Involved. rather than strategic. Sound Management Practices. Strategic Context of Growth and Expansion. Appropriate People Participating Full-Time and Sufficient Budget. Developing and Prioritizing Objectives. levels. Shared Vision. and. Identifying Trade-Offs Between Processes.

process reengineering. Their propositions center around the concepts of knowledge management.Kettinger & Grover (1995) outline some propositions to guide future questions into the phenomenon of BPR. However. BPR emerged as a concept geared towards a clean slate. King (1994) believes that although the current interest in BPR may end. employee empowerment. Malhotra (1998) has developed the key emphasis on these issues based primarily on an integrated view of recent literature from organization theory. As a result. organization control. strategy.
Conclusion
Dramatic changes in the business environment throughout the nineteen eighties forced organizations to examine outdated modes of work and develop new focused strategies based on new business models. adoption of new IT's. Reengineering is not just a matter of fundamental and radical improvements in performance. and IS. Many business management concepts emerged but BPR has probably been the most influential. the concept of BPR has survived and has been broadened to become more commonly associated with multidimensional process change efforts. radial approach. tools and techniques for BPR projects have developed out of implementation failures. Earl et al. but is also an approach to analyzing and transforming the nature of businesses and industries.
. and change management and control and used it to develop more BPR strategies. in some form or another would endure. strategy. and a shared vision. organizational cultures and IT infrastructures had become significantly linked with organizations. IS. the original ideas did not take into account the situations in organizations where factors such as the evolution of the ways of work. (1995) have proposed a "process alignment model" that consists of four emphases: process. A variety of methodologies.